Beliefs and common sense guide us in making myriad decisions every day. However, because we believe something to be true or judge it to be true based on "common sense", doesn't make it true. A belief can be validated only by testing it with evidence. This blog is neither right nor left, but undoubtedly will annoy individuals across the spectrum who hold unsupported convictions. My hope is that this blog will encourage us to challenge each others' beliefs and, most importantly, our own.

Tuesday, March 27, 2012

Obamacare on Trial

Today the US Supreme Court held oral arguments on the Patient Protection and Affordable Care Act
with respect to the issue of whether a Federal mandate requiring citizens to
purchase health insurance is Constitutional.

The Court could uphold the law, strike down the mandate but
let the rest of the law stand, or strike down the entire law on the basis that
the mandate is central to the functioning of the law.

The debate in some sense revolves around a technicality in
that the law could have obtained the same result without raising this
Constitutional issue (say by providing a tax credit for purchase of health
insurance). The technicality of course
is extremely important. If the law is struck down Congress, as presently
constituted, would not pass anything remotely similar to the Patient Protection and Affordable Care Act.

Obamacare suffers from some serious defects. For example, it preserves the employer based
system for providing health care. In part this is accomplished by exempting from taxation health
insurance premiums paid by employers but not exempting health insurance premiums
paid by individuals. It is
ridiculous to have a system where one has to change one’s health care system
every time one changes jobs. Creating an impediment for individuals to change jobs also has adverse consequences for the economy as a whole.

Furthermore, as we have recently witnessed, employers
may decide that they wish to impose arbitrary conditions, based on their religious beliefs or conscience, on their
employees’ health care. Employers may
decide that they do not wish to cover everything from contraception to blood
transfusions. Perhaps it may violate an
employer’s conscience to cover
expensive procedures. What is more
odious than an employer effectively entering his/her employees’ bedrooms and
hospital rooms to decide what type of medical care the employer deems to be moral?

A second major defect of Obamacare is that it does not contain
mechanisms to adequately control cost. Health insurance premiums have continued to escalate since passage of Obamacare.

To effectively reform the US health care system we need to
recognize that our current system is badly broken. The US spends approximately twice as much per
capita as other countries on health care, obtains inferior results as measured
by health care outcomes, and (at least prior to implementation of Obamacare) leaves a large fraction of the population
uninsured.

Reform of the health care system, in my opinion, requires
the adoption of two principles:

One, everyone should have access to a basic level of health
care. As an ethical society we should not allow someone to sicken or die
because he/she cannot afford health care. Such care needs to be comprehensive and longitudinal. It is less costly and more effective to provide preventative care and not
just provide care when someone lands in the emergency room in extremis.

Two, the cost of the basic health care system has to be
subject to a capped budget. There is no
limit to the amount that one can spend on health care. There will always be new drugs, devices,
diagnostics and therapies that one can spend money on. Hard-nosed decisions have to be made regarding
what is the most cost-effective way to spend basic basic health care dollars. Making sure that children are vaccinated is highly cost-effective; spending hundreds of thousands of dollars on
a cancer therapy expected to extend a patient’s life by a few weeks is not cost-effective. That said,
individuals who wish to purchase supplementary health insurance beyond a
universally provided basic health care benefit should be free to do so. That supplementary insurance can cover
treatments that are not covered within a basic health care package.

Once one accepts the above principles, there remain issues
of how to implement the basic universal health care package. We could adopt, for example, a single payer Medicare for All system. As an alternative, I have suggested in
a previouspost a type of voucher system in which different health plans have to compete
for patients in providing a basic health care package. In this scenario, the basic health care
package would include a defined set of minimum required benefits. The voucher system has the potential for
harnessing competition to improve quality and put pressure on providers to control
costs.

Any proposed system should optimally be tested in local pilot programs
to detect unforeseen problems prior to broad implementation.

However imperfect Obamacare is, if the Supreme Court strikes it down many individuals will be left without access to healthcare. This would be a tragedy.

Whatever the Supreme Court decides, there remains
much work to be done to provide US citizens with an affordable, effective and ethical
health care system.